VanillaSoft to double Gatineau headcount with $4M funding boost


A software firm that prides itself as the “original sales engagement platform” is primed to double its Gatineau headcount with an additional 30 hires thanks to fresh funding.

VanillaSoft announced Thursday it’s getting a $3-million investment from Fonds Régionaux de Solidarité FTQ Outaouais (FRSO) to supplement a recently announced $1-million loan from Canada Economic Development for Quebec Regions.

CEO David Hood tells Techopia the cash injection from FRSO is as much about helping VanillaSoft as it is repaying the fund for its early support. More than a decade ago when the software firm was just starting out, loans from the FRSO helped the company to find its footing. The new financing, on the other hand, will give the fund its first equity stake in the company it took a chance on those many years ago.

“Before we got too big, we really wanted to give them the opportunity to be sitting at that table and benefiting from the support and what they did to contribute to get us there,” Hood says.

Twist of fate

Hood joined VanillaSoft some 15 years ago after selling stock photo and digital clip-art firm Hemera in 2003. He reconnected with former Harvard Business School classmate Ken Murray, who was starting a company in New Orleans to help telemarketing companies identify and engage high-quality sales leads.

The turn of the millennium marked the height of predictive dialing programs that scoured phone books to give callers rapid leads. While the scattershot method raised efficiencies for many telemarketers, VanillaSoft instead took a quality-over-quantity approach, looking to give customers a more targeted view of who its salespeople were calling.

“You had telemarketing software designed for calling through the phone book, but not designed for calling high-quality lists. You don't want to predictively dial your (own) customers,” Hood gives as an example.

The firm’s software impressed Hood, who was looking for a new opportunity and immediately jumped on board. As it turns out, the National Capital Region resident joined VanillaSoft at a pivotal time – Hurricane Katrina hit the United States that August.

“We never got back into the office in New Orleans,” Hood recalls.

The disaster south of the border meant VanillaSoft’s recently incorporated Canadian operations became the de facto centre of the company. Hood credits the CED and FRSO for helping the company get settled in the National Capital Region back then, and marvels at how the hurricane became a strange twist of fate that spurred growth in VanillaSoft’s Gatineau offices, which stand at around 30 employees today.

“Katrina hit and wiped out the office in the U.S., and it's the office here that grew,” he says. “This would have been a company that was completely in the U.S. Instead, the majority of the employees are up here, the revenues are up here, and it's Canada that quite honestly is really benefiting from it.”

Sales engagement pioneer

Hood says VanillaSoft struggled in the beginning with explaining its product to the market, as prospects continually compared the firm’s software to a customer-relationship manager (CRM). The firm secured a modest but loyal customer base in the early days, but the recent emergence of the sales engagement category has given the company, which has since added email, SMS and social media plug-ins to its phone offerings, a clear value proposition.

“We like to say we were the original sales engagement platform, because that's what we have been doing for over a decade. It's just there was no term for it,” says Hood.

VanillaSoft will put its fresh funding towards scaling its sales staff, with an estimated 30 extra hires expected in the Gatineau offices alone. The majority of the firm’s customers are in the U.S., but the past month has seen it add to its staff in New Zealand and Australia and double its headcount in Europe, where it’s seeing strong growth in the United Kingdom and Ireland.

Some of the money will also go towards R&D. Hood says the next few weeks will see VanillaSoft unveil its first artificial intelligence-powered product, which will look to synthesize the 15 million calls, emails and other activities generated monthly on its platform into useful data for its customers.

“We've got a tremendous amount of data and data points that we're able to use to help our customers better analyze their business,” Hood says. “We have a first functionality that will be coming out in the next couple of months to use that data through AI to help optimize the sales process.”